Snap Inc. (NYSE: SNAP), a leading social media and technology company, has continued to capture the attention of investors and analysts. BMO Capital Markets recently reaffirmed their “outperform” rating on Snap’s stock, highlighting its growth potential despite a slight reduction in their price target from $18.00 to $16.00. Let’s dive deeper into the recent developments, analyst predictions, and the overall performance of Snap’s stock.
Key Analyst Ratings and Updates
Snap has been the subject of several updates from prominent analysts, reflecting a wide spectrum of opinions:
BMO Capital Markets
- Maintained an “outperform” rating.
- Adjusted price target from $18.00 to $16.00, signaling optimism in Snap’s long-term potential.
Cantor Fitzgerald
- Raised Snap’s price objective from $8.00 to $9.00.
- Assigned a “neutral” rating, indicating moderate expectations for near-term growth.
Stifel Nicolaus
- Lowered the price target from $13.00 to $11.00.
- Rated Snap as “hold,” suggesting cautious optimism.
Evercore ISI
- Increased Snap’s price target from $12.00 to $15.00.
- Gave an “in-line” rating, consistent with market performance predictions.
Royal Bank of Canada and UBS Group
- Maintained a balanced view with a “sector perform” and “neutral” rating, respectively.
- UBS raised their target from $12.00 to $13.00, reflecting steady growth expectations.
According to MarketBeat.com, Snap has an average consensus rating of “hold,” with one analyst recommending “sell,” 22 analysts advising “hold,” and nine supporting a “buy.” The consensus price target currently stands at $36.99.
Snap’s Stock Performance Overview
On Wednesday, Snap’s stock traded at $11.82, reflecting an increase of $0.48 during mid-day trading. The trading volume exceeded 35 million shares, significantly higher than its average daily volume of 30 million shares.
Key Financial Metrics
- Market Capitalization: $19.82 billion.
- Price-to-Earnings (P/E) Ratio: -20.38, indicating negative earnings as the company continues to reinvest in growth.
- Beta: 0.98, reflecting moderate volatility in line with the broader market.
- 52-Week Range: The stock has fluctuated between a low of $8.29 and a high of $17.50.
Moving Averages
- 50-Day Moving Average: $11.57.
- 200-Day Moving Average: $11.40.
Recent Earnings and Revenue Highlights
Snap reported its third-quarter earnings on October 29, surpassing expectations with an earnings per share (EPS) of $0.08, beating the consensus estimate of $0.05. The company’s revenue for the quarter reached $1.37 billion, a 15.4% year-over-year increase, slightly ahead of market expectations.
While Snap continues to face challenges with negative margins, including a net margin of -18.49% and a return on equity of -35.60%, its revenue growth highlights the company’s ability to innovate and expand its user base.
Looking Ahead
Equity research analysts project Snap to post an annual EPS of -$0.40 for the current fiscal year. Despite these negative earnings, the company’s ability to increase revenue demonstrates resilience in a competitive market.
Insider Transactions and Institutional Activity
Insider Selling Activity
Snap executives have recently reduced their holdings:
- Derek Andersen (CFO): Sold 94,164 shares at $11.44 per share, totaling $1.08 million.
- Rebecca Morrow (CAO): Sold 11,154 shares at $10.55 per share, generating $117,675.
In the past 90 days, Snap insiders have sold a total of 1.45 million shares valued at over $17.5 million. Insiders currently own 22.68% of the company’s stock.
Institutional Investment
Institutional investors own approximately 47.52% of Snap’s stock. Recent transactions include:
- V Square Quantitative Management LLC and Paladin Wealth LLC acquiring new stakes in Snap.
- Advisors Asset Management Inc.: Increased its position by 141.9%, now holding 2,782 shares.
These activities indicate continued interest in Snap among institutional investors, despite the mixed analyst outlook.
About Snap Inc.
Snap Inc. operates as a technology-driven company offering its flagship application, Snapchat. The platform features innovative tools like:
- Snap Map: Real-time location sharing.
- Stories: Content sharing through photos and videos.
- Spotlight: A space for short-form user-generated content.
The company’s core focus on augmented reality and visual communication tools positions it as a key player in the evolving social media landscape.